Biden says debt default deal ‘very close’ as deadline extended

Time running short, the government announced a new June 5 default deadline late Friday, threatening to send the White House and Republicans toward more cliff-edge negotiations over cutting spending and raising the nation’s legal debt limit

Yet President Joe Biden was upbeat as he left for the Memorial Day weekend at Camp David, declaring, “It’s very close, and I’m optimistic.”

With Republican at the Capitol talking with Biden’s team at the White House, he said he hoped “we’ll know by (Friday night) whether we’re going to be able to have a deal.”

The new date, set out in a letter from Treasury Secretary Janet Yellen, came with Americans and the world concerned about U.S. brinkmanship. In a blunt warning, Yellen said failure to act by the new date would “cause severe hardship to American families, harm our global leadership position and raise questions about our ability to defend our national security interests.” Anxious retirees were already making contingency plans for missed checks, with the next Social Security payments due next week.

Biden and Republican House Speaker Kevin McCarthy have seemed to be narrowing on a twoyear budget-slashing deal that would also extend the debt limit past the next presidential election. After frustrating rounds of closeddoor talks, a compromise had appeared to be nearing on Friday.

Republicans have made some headway in their drive for steep spending cuts that Democrats oppose. But the sides are particularly “dug in” over McCarthy’s demands for tougher work requirements on government food stamp recipients that Democrats say is a nonstarter.

They are likely to claw back some $30 billion in unspent COVID-19 funds, as the pandemic emergency has officially been lifted.

Lawmakers are expected to claw back $30 billion in unspent COVID-19 funds, as the pandemic emergency has officially been lifted.